Steadying Below $1,700/oz As Dollar Holds Post-CPI Gains

Gold deals ~$3/oz weaker to print $1,695/oz, operating a little above Wednesday’s one-week lows at writing, having left the $1,700/oz mark unchallenged throughout Asia-Pac dealing so far.

• To recap, gold closed $5 lower on Wednesday, ending below $1,700 for the first time in two weeks, with the higher than expected U.S. core PPI reading (+7.3% Y/Y vs. BBG median +7.0%) doing little to lift gloom in the space re: worry over Fed rate hikes amidst persistent, elevated inflation.
• Gold trade around its lowest levels for Sep as the USD has held on to the bulk of its post-CPI rally from Tuesday, with the DXY operating just shy of the 110.00 mark at writing.
• Zooming out, the precious metal sits ~$15 above its lowest levels for ‘22 ($1,681.0, Jul 21 low), with the move lower facilitated by a simultaneous rally in the Dollar and U.S. real yields.
• From a technical perspective, gold remains in a clear downtrend. Initial support is seen at $1,681.0 (21 Jul low and bear trigger), while resistance is located at ~$1,735.1 (Sep 12 high).